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Specifically, product activation refers to a method patented by Uniloc where a software application hashes hardware serial numbers and an ID number specific to the product's license (a product key) to generate a unique installation ID. This installation ID is sent to the manufacturer to verify the authenticity of the product key and to ensure that the product key is not being used for multiple installations.
Alternatively, the software vendor sends the user a unique product serial number. When the user installs the application it requests that the user enter their product serial number, and checks it with the vendor's systems over the Internet. The application obtains the license limits that apply to that user's license, such as a time limit or enabling of product features, from the vendor's system and optionally also locks the license to the user's system. Once activated the license continues working on the user's computer with no further communication required with the vendor's systems. Some activation systems also support activation on user systems without Internet connections; a common approach is to exchange encrypted files at an Internet terminal.